Nick Clegg came under attack yesterday after threatening to cut tax credits for millions of children.

The deputy Prime Minister said it was "madness" to keep paying the benefit to middle and high income families "in light of the giant black hole in public finances."

His spoke as he set out plans to give grandparents more rights in looking after grandchildren and vowed flexible working for parents. But Labour's shadow children secretary Ed Balls said: "This government can have no credibility when they are cutting child trust funds, youth jobs, university places, free school meals and programmes to tackle teenage pregnancy and youth crime.

"This announcement is a smokescreen to divert attention from short-sighted cuts to services which make a difference."